June 26, 2009

EU executives tackles 25 states over energy reform

BRUSSELS - The European Union's executive said on Thursday 25 of the bloc's 27 countries were not doing enough to boost energy market competition for the benefit of consumers, taking the first step towards possible court action.

It launched so-called infringement procedures for failure to implement the EU's second package of internal energy market laws -- reforms phased in between 2004 and 2007 to open gas and electricity markets to more competition.

"This major infringement exercise focuses on three broad areas of concern: lack of transparent, simple and inexpensive procedures for dealing with consumer complaints; lack of transparent access to cross-border electricity and gas network infrastructure, and market distortions caused by regulated energy prices," the European Commission said in a statement.

Every EU member state with an electricity connection to a neighbour is facing possible action, with only the islands of Malta and Cyprus escaping unscolded because they are physically detached from the rest of the bloc.

The 25 will receive letters of formal notice for not complying with gas and electricity regulations, the EC said. Many of those states had received warnings on similar issues in 2006.

Many European energy regulators or governments were unavailable to comment or declined to comment until they received the repriminands from Brussels.

"We will consider it carefully when we have received the letter. We are committed to ensuring compliance," a spokeswoman for British energy regulator Ofgem said.

Meanwhile, environment ministers meeting in Luxembourg formally approved the EU's third package of reforms, which aim to liberalise EU energy markets further still.